Fab equipment spending increases by 24%

After two years of decline, fab equipment spending is expected to increase 24% in 2014 to US$35.7 billion, according to SEMI. In terms of equipment spending, 2015 may reach or even surpass the historic record year of 2011 (about US$39.8 billion).

In 2014, the three largest regions for fab equipment spending will be Taiwan with over US$10.3 billion, the Americas with over US$6.8 billion and Korea with over US$6.3 billion. In 2015, these same regions will lead in spending: Taiwan will spend over US$11 billion, Korea over US$8 billion and the Americas almost US$7 billion.

Although sixth in regional equipment spending this year, the Europe/Mideast region will show the strongest rate of growth, about 79% compared to the previous year. The same region will continue to grow fast in 2015, with an increase of about 20%.

Worldwide installed capacity is very low for both 2014 and 2015 and the SEMI data does not suggest that this will change over the next four years. Because of the increased complexity of leading-edge nodes, such as more process steps and multiple patterning, fabs experience a decline in capacity as the same fab space produces less. Worldwide, installed capacity grew by less than 2% in 2013 and is expected to grow just 2.5% in 2014 and 3% in 2015.

SEMI’s detailed data predict that Foundry capacity continues to grow at 8-10% yearly (a steady pace since 2012) and Flash is up 3-4% for 2014. Although DRAM equipment spending is expected to grow by 40% in 2014 as many fabs upgrade to a leading-edge process, installed capacity for DRAM is expected to stay flat or even drop 2%. SEMI’s reports also cover capacity changes for other product segments:  MPU, logic, analog/mixed signal, power, discretes, MEMS, and LED and opto.